Trading Plan: Can bears drag Nifty 50 down to 24,700, Bank Nifty toward 56,200?

Nifty Trading Plan for July 28

The Nifty 50 and Bank Nifty extended their downtrend for another session with negative momentum indicators on July 27, signaling weakness ahead. Experts advised a “sell on rally” strategy. According to them, if the Nifty 50 sustains below 25,000, the next level to watch is 24,700, followed by 24,500. On the higher side, the 24,950–25,000 zone can act as a hurdle. Meanwhile, the Bank Nifty is expected to consolidate as long as it trades below the 57,300 hurdle. A move above this level could pave the way for a record high. The immediate resistance lies at 56,800–57,000, while the 56,200–56,100 zone can provide immediate support. A break below this could trigger strong bearish action.

On July 25, the Nifty 50 plummeted 225 points to close at 24,837, while the Bank Nifty plunged 537 points to 56,529, with market breadth heavily dominated by bears. About 2,179 shares declined versus 475 shares that gained on the NSE.

Nifty Outlook and Strategy

Rajesh Bhosale, Technical Analyst at Angel One

The chart structure has clearly deteriorated for the bulls. On the daily chart, Nifty had been trading within a “Rising Channel” pattern since May. However, this week’s breakdown below the channel’s lower boundary confirms a bearish reversal. Importantly, this breakdown is accompanied by a bearish gap, which qualifies as a “Breakaway Gap,” adding further conviction to the bearish setup.

Additionally, the index has broken below the 50-day EMA, a level that had previously provided strong support. This shift marks a significant change in short-term momentum in favour of the bears. On the indicator front, the RSI Smoothened has slipped below 39, a level not seen since the April swing lows, reinforcing the weakening trend. Collectively, these signals suggest the potential for deeper downside, possibly toward the 200-day SMA, which lies in the 24,200–24,000 zone.

For the coming week, the immediate support is placed near the 89-day EMA at 24,650, followed by 24,500 (strong May–June base). On the upside, the bearish gap and the 50DEMA zone around 24,950–25,000 can now act as immediate resistance, followed by the 25,250 level (the recent high).

Key Resistance: 25,000, 25,100

Key Support: 24,650, 24,500

Strategy: Sell Nifty Futures on a bounce around 24,950, with a stop-loss of 25,100, targeting 24,650 / 24,500.

Rajesh Palviya, Senior Vice President Research (Head Technical Derivatives) at Axis Securities

Nifty closed the week down by 131 points. On the weekly chart, the index formed a small bearish candle with a long upper shadow, indicating selling pressure near the 20-day SMA at 25,259. The index continues to face resistance at this key moving average, highlighting ongoing weakness. A sustained move below 25,000 could lead to further downside toward the 24,500–24,300 range. Conversely, a decisive breakout above 25,000 may restore positive momentum.

The chart structure suggests that a break above 25,000 could attract buying interest, while a drop below 24,750 might trigger fresh selling, pushing Nifty lower to the 24,500–24,300 levels.

For the upcoming week, we anticipate Nifty to trade within a broad range of 25,500–24,300, with a mixed-to-negative bias. Additionally, the weekly RSI has turned negative and remains below its reference lines, reinforcing the bearish outlook.

Key Resistance: 25,000, 25,100

Key Support: 24,700, 24,600

Strategy: Sell Nifty Futures around 24,960 with a stop-loss of 25,060, targeting 24,750–24,650.

Anshul Jain, Head of Research at Lakshmishree

As anticipated last week, Nifty gave a decisive close below the fair value area and gap, confirming a bearish shift. Rallies toward the previous week’s high were aggressively sold into, especially in the last two sessions, with sharp volumes rejecting both the 8- and 21-day EMAs. The index closed below last week’s low, reinforcing negative momentum.

Critically, Nifty has also slipped below the 50-day EMA, a clear signal of growing weakness. The daily structure has turned bearish, with momentum indicators flipping negative. The next key level to watch is the swing low at 24,733, which now becomes a prime target for bears. While this level could act as support and trigger a short-term bounce, the broader trend remains down. Until strong buying confirms otherwise, this market remains a sell-on-rallies environment.

Key Resistance: 24,900, 25,050

Key Support: 24,733, 24,650

Strategy: Sell Nifty Futures on rallies to the 24,900–25,050 zone, targeting 24,733.

Bank Nifty - Outlook and Positioning

Rajesh Bhosale, Technical Analyst at Angel One

On the charts, the Bank Nifty appears to be stuck in a tight trading range between 57,300 on the upside and 56,200 on the downside. Unless there is a decisive breakout beyond this range, a meaningful directional move is unlikely. Given the increasing vulnerability in the broader market, particularly with the Nifty50 breaking key support levels, a more cautious stance is warranted. Aggressive long positions should be avoided for now.

In terms of levels, immediate resistance is likely around the 56,700–57,000 zone, while strong support lies in the 56,200–56,000 zone, which aligns with the 50 DEMA and a recent swing low.

Key Resistance: 56,700, 57,000

Key Support: 56,200, 56,000

Strategy: Sell Bank Nifty Futures on a bounce around 56,750, with a stop-loss of 57,200, targeting 56,000 / 55,800.

Rajesh Palviya, Senior Vice President Research (Head Technical Derivatives) at Axis Securities

Bank Nifty posted a weekly gain of 246 points. On the weekly chart, the index formed a long-legged Doji, indicating indecision among participants. It ended the week below the 20-day SMA (56,964), which suggests underlying weakness. A decisive close above this SMA is crucial for momentum to shift in favour of the bulls.

A move above 57,000 may trigger buying interest toward 57,300–57,650. Conversely, a break below 56,300 could lead to selling pressure towards 55,800–55,200.

For the week ahead, Bank Nifty is expected to trade in a broad range of 57,650–55,200, with a mixed bias. The weekly RSI has turned flat, showing lack of direction, while the Stochastic indicator remains in negative territory, suggesting a negative bias.

Key Resistance: 56,750, 57,000

Key Support: 56,400, 56,200

Strategy: Sell Bank Nifty Futures near 56,750 with a stop-loss of 57,000, targeting 56,450–56,300.

Anshul Jain, Head of Research at Lakshmishree

Bank Nifty has remained within the 56,400–57,300 range, but the swift rejection at the upper end, followed by heavy selling, is a clear sign of distribution. This puts the range low of 56,400 under serious pressure.

A decisive close below the 56,400–56,300 zone could open the door for the next leg down. The first key support lies at the 50-day EMA around 56,100, with the swing low at 55,400 as the next downside level.

Momentum indicators are firmly bearish, suggesting that any bounce will likely be sold into. The structure now favours bears, and unless the index quickly reclaims lost ground, the path of least resistance remains downward. For now, 56,400 is the key level—a breach could accelerate the decline and confirm a short-term trend reversal.

Key Resistance: 56,800, 57,300

Key Support: 56,400, 56,000

Strategy: Sell Bank Nifty Futures on rallies toward 56,800, targeting 56,000.